Comparing Merit Medical Systems (NASDAQ:MMSI) & NexGel (NASDAQ:NXGL)

NexGel (NASDAQ:NXGL) and Merit Medical Systems (NASDAQ:MMSI) are both healthcare companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, profitability, risk and dividends.

Analyst Recommendations

This is a breakdown of current ratings for NexGel and Merit Medical Systems, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NexGel	1	1	0	0	1.50
Merit Medical Systems	0	3	8	1	2.83

NexGel currently has a consensus target price of $2.00, indicating a potential upside of 569.79%. Merit Medical Systems has a consensus target price of $100.00, indicating a potential upside of 14.69%. Given NexGel’s higher possible upside, equities analysts plainly believe NexGel is more favorable than Merit Medical Systems.

Insider & Institutional Ownership

2.2% of NexGel shares are owned by institutional investors. Comparatively, 99.7% of Merit Medical Systems shares are owned by institutional investors. 19.8% of NexGel shares are owned by insiders. Comparatively, 0.7% of Merit Medical Systems shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares NexGel and Merit Medical Systems”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NexGel	$11.42 million	0.25	-$3.00 million	($0.71)	-0.42
Merit Medical Systems	$1.52 billion	3.43	$128.49 million	$2.42	36.03

Merit Medical Systems has higher revenue and earnings than NexGel. NexGel is trading at a lower price-to-earnings ratio than Merit Medical Systems, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares NexGel and Merit Medical Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NexGel	-51.26%	-121.18%	-41.15%
Merit Medical Systems	9.22%	13.75%	8.10%

Risk and Volatility

NexGel has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, Merit Medical Systems has a beta of 0.49, meaning that its share price is 51% less volatile than the S&P 500.

Summary

Merit Medical Systems beats NexGel on 12 of the 15 factors compared between the two stocks.

About NexGel

NEXGEL, Inc. manufactures high water content, electron beam cross-linked, and aqueous polymer hydrogels and gels. Its products are used for wound care, medical diagnostics, transdermal drug delivery, and cosmetics. The company was formerly known as AquaMed Technologies, Inc. and changed its name to NEXGEL, Inc. in November 2019. The company was incorporated in 2009 and is based in Langhorne, Pennsylvania.

About Merit Medical Systems

Merit Medical Systems, Inc. designs, develops, manufactures, and markets single-use medical products for interventional, diagnostic, and therapeutic procedures in the United States and internationally. It operates in two segments, Cardiovascular and Endoscopy. The company provides micropuncture kits, angiographic needles, sheaths, guide wires, and safety products; peripheral intervention, including angiography, drainage, delivery systems, and embolotherapy products; spine products, such as vertebral augmentation, radiofrequency ablation, and bone biopsy systems; oncology products; and cardiac intervention products, such as access, angiography, electrophysiology and cardiac rhythm management, fluid management, hemodynamic monitoring, hemostasis, and intervention to treat various heart conditions. It also offers custom procedural solutions that include critical care products, disinfection protection systems, syringes, manifold kits, and trays and packs; coating services for medical tubes and wires; and sensor components for microelectromechanical systems. In addition, the company provides pulmonary products that consist of laser-cut tracheobronchial stents, over-the-wire and direct visualization delivery systems, and dilation balloons to endoscopically dilate structures; gastroenterology products, such as covered esophageal stents, syringe and gauges, and balloon dilators; and kits and accessories for endoscopy and bronchoscopy procedures. It sells its products to hospitals and alternate site-based physicians, technicians, and nurses through direct sales force, distributors, original equipment manufacturer partners, or custom procedure tray manufacturers. The company was incorporated in 1987 and is headquartered in South Jordan, Utah.